SSTI Digest

Venture development organizations (VDOs) increasingly serve as the Swiss Army knife of small business growth and innovation throughout the country due to their diverse range of entrepreneurial programs, direct financing options, and commitment to local economic development. Their unique roles in the entrepreneurial ecosystems and regional public-private partnerships have allowed for startup success despite the financial instability brought on by the COVID-19 pandemic.

In a previous article, SSTI detailed the limitations of public funding in solving the country’s rural broadband issue. While increased public funding is certainly part of the equation to bring internet capabilities to the near 14 million people who do not have access, there is potential to leverage new innovative technologies to bridge the broadband gap across America.

Throughout the past decade, the Latino entrepreneurial landscape has experienced both a growth in average annual revenue and an increase in the establishment of new employer businesses. However, Latino business owners remain significantly less likely than white business owners to receive loan approvals from major banks, resorting instead to financing options that expose the business owners to more personal financial risk including personal and business lines of credit and personal home equity loans.

The overall employment outlook for the recipients of doctorate degrees earned at U.S. institutions has improved from 2015 to 2019, while the research activities conducted by these highly trained and educated individuals has started to shift away from basic and applied research activities towards activities focused on design and development. Doctorate recipients play an essential role in developing the knowledge base leveraged in creating new technologies and companies in the innovation economy. Understanding the employment trends of this vital group can help in crafting programs and policies to strengthen local innovation economies.

The most recent annual report from the Small Business Administration (SBA) concludes that a majority of participating federal agencies did not comply with the mandated minimum spending requirements for the Small Business Innovation Research and Small Business Technology Transfer (SBIR/STTR) programs.

SSTI is making Addressing Capital Access in 2021, which had previously been available only to SSTI member organizations, publicly available. The paper is focused on helping states and their partners make the most of the opportunity presented by the newly-refunded State Small Business Credit Initiative (SSBCI 2.0), which provides $10 billion to states to support capital access.

Last week, a bipartisan, bicameral group of legislators reintroduced the Endless Frontier Act, a bill that would authorize more than $112 billion over five years for new research and commercialization activities within the National Science Foundation (NSF) and the Department of Commerce. This proposal would establish multiple tools at each agency to support regional innovation economies. Sen.

In 2014, Tennessee’s Republican governor, Bill Haslam, created the nation’s first program to ensure high school graduates could attend community and technical college tuition-free, Tennessee Promise.  While several states have followed suit in one form or another, President Joe Biden wants to take the concept nationwide with the federal government footing $109 billion of the bill through his American Families Plan.

President Joe Biden has nominated Alejandra Y. Castillo to serve as the next assistant secretary for economic development in the U.S. Department of Commerce. If confirmed, she will have a unique opportunity to leave a significant imprint on regional efforts toward growing prosperity as a result of the $3 billion appropriated to the Economic Development Administration in March through the America Rescue Plan Act. 

As state budgets move into the legislatures for final negotiations and approvals, the last of the governors have addressed their constituents and put forth their proposals. While a renewed sense of hope is seeping into the latest addresses, governors are still cautious and guarded in proposing new programs. Broadband, small business, education and workforce initiatives continue to be among the innovation-related initiatives announced by the state leaders, with the intent that those efforts will also boost the economic recovery of the states.

As the new administration settles in, the Economic Development Administration (EDA) has updated its investment priorities — the guiding principles behind all of its competitive grants. Changes to the priorities are outlined below so that participants in local innovation economies are better able to align their proposed programs to these federal priorities.

If venture capital was water, then sea levels continue to rise.  Yet more and more innovation-based startups across the country seemingly are being left high and dry as private venture capitalists continue to push their money into bigger, later stage deals. Investors seem increasingly set to cruise toward cashing in on the currently hot exit path of public listings.